Guest essay by Eric Worrall
According to Time the world currently spends 1% ($0.8 trillion / year) of global income on renewables. But for the “surprisingly low cost” of $2.4 Trillion / year, we could make all the green energy fantasies come true, though we might also have to become vegans and surrender our pension funds.
The Surprisingly Low Price Tag on Preventing Climate Disaster
BY YUVAL NOAH HARARI JANUARY 18, 2022 6:55 AM EST
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Despair is as dangerous as denial. And it is equally false. Humanity has enormous resources under its command, and by applying them wisely, we can still prevent ecological cataclysm. But exactly how much would it cost to stop the apocalypse? If humankind wanted to prevent catastrophic climate change, how big a check would we have to write?
Naturally enough, no one knows for sure. My team and I have spent weeks poring over various reports and academic papers, living in a cloud of numbers. But while the models behind the numbers are dizzyingly complex, the bottom line should cheer us up. According to the International Energy Agency, achieving a net-zero carbon economy would require us to spend just 2% of annual global GDP over what we already do on our energy system. In a recent poll of climate economists conducted by Reuters, most agreed that getting to net zero would cost only 2% to 3% of annual global GDP. Other estimates put the cost of decarbonizing the economy a bit lower or a bit higher, but they are all in the low single digits of annual global GDP.
These numbers echo the assessment of the Intergovernmental Panel on Climate Change, which in its landmark 2018 report stated that in order to limit climate change to 1.5°C, annual investments in clean energy needed to increase to around 3% of global GDP. Since humankind already spends about 1% of annual global GDP on clean energy, we just need an extra 2% slice of the pie!
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The above calculations focus on the cost of transforming the energy and transportation sectors, which are by far the most important. However, there are other sources of emissions as well, like land use, forestry and agriculture. You know, those infamous cow farts. The good news is that a lot of these emissions can be cut on the cheap through behavioral changes such as reducing meat and dairy consumption and relying more on a plant-based diet. It doesn’t cost anything to eat more veggies, and it can help you (and the rain forests) live longer.
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In just the first nine months of 2020, governments around the world announced stimulus measures worth nearly 14% of global GDP to deal with the COVID-19 pandemic. If citizens press them hard enough, politicians can do the same to deal with the ecological crisis. So can investment banks and pension funds. Pension funds hold about $56 trillion USD. What’s the point of having a pension if you don’t have a future?
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Read more: https://time.com/6132395/two-percent-climate-solution/
Yuval Noah Harari’s bio describes him as a historian, philosopher and author.
I love watching Dragon’s Den, a BBC TV series in which ordinary people with business ideas get to pitch to the “dragons”, very wealthy self made people who built up their own fortunes through investment and business creation.
One thing which is very clear is how quickly the dragons reject losers. They very rarely put money into micro businesses which are operating at a loss, because if the business can’t make money on a small scale, pumping more money in to scale the business up usually just increases the rate at which the idea loses money.
If renewable energy cannot become self sustaining with an injection of $0.8 trillion per year, an additional $1.6 trillion per year is not going to fix anything.
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